New Zealand Treasury - there is still some spare capacity in the labour market

Omkar Godbole FXStreet Contributor

New Zealand Treasury sees some spare capacity in the labor market, according to monthly economic indicators report.

Key points

The unemployment rate (unemployed as a share of the labour force) has been decreasing since 2012, but underemployed as a share of the labour force has been stable at around 4%. This indicates there is still some spare capacity in the labour market.
The unemployment rate fell to 4.5% in December, and wage measures were mixed, with annual Quarterly Employment Survey (QES) growth of 3.1%, but Labour Cost Index (LCI) growth unchanged at 1.8%.
House prices and sales volumes both increased in January.
Consumption indicators were positive: for the December quarter retail sales volumes rose 1.7% (sa), and in January electronic cards spending rose 1.4% (sa).
Global 10-year bond yields pushed higher in February as analysts expect a faster pace of tightening of monetary policy in 2018.

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

Editor's Picks

EUR/USD falls toward 1.1700 on broad USD recovery

EUR/USD turns south and declines toward 1.1700 on Wednesday. The US Dollar gathers recovery momentum and forces the pair to stay on the back foor, as traders look to USD short-covering ahead of US inflation report on Thursday. However, the downside could be capped by hawkish ECB expectations.

GBP/USD trades deep in red below 1.3350 after soft UK inflation data

GBP/USD stays under strong selling pressure midweek and trades below 1.3350. The UK annual headline and core CPI rose by 3.2% each, missing estimates of 3.5% and 3.4%, respectively, reaffirming dovish BoE expectations and smashing the Pound Sterling across the board ahead of Thurday's BoE policy announcements.

Gold clings to moderate daily gains above $4,300

Following Tuesday's volatile action, Gold regains its traction on Wednesday and trades in positive territory above $4,300. While the buildup in the USD recovery momentum caps XAU/USD's upside, the cautious market stance helps the pair hold its ground.